Microsoft is not the source of a message reading "Microsoft says I'm not connected to the internet," a common troubleshooting prompt Windows users…
Microsoft is not the source of a message reading "Microsoft says I'm not connected to the internet," a common troubleshooting prompt Windows users encounter, but this week the company made a different kind of headline: it is cutting 4,800 jobs, with nearly a third of them hitting the Xbox division.
What Sharma Told Staff
Xbox chief Asha Sharma, who took over from Phil Spencer in February, told employees in a Monday email that the company is undertaking the "most significant restructure in Xbox history." She confirmed about 3,200 job cuts across the gaming business over the coming fiscal year, with roughly 1,600 of those eliminations happening right away and the rest phased in through fiscal 2027.
Sharma did not soften the message. "Our business today is not healthy," she wrote, adding that in a typical year the division "lost 64 cents for every dollar we invested." She also said Microsoft has "learned that we are not the best home for every type of studio," a line that foreshadowed the studio departures announced alongside the layoffs.
Four Studios Cut Loose
Compulsion Games, Double Fine Productions, Ninja Theory, and Undead Labs are all leaving Microsoft's ownership. Compulsion, based in Montreal, made South of Midnight and We Happy Few. Double Fine, founded by Tim Schafer in San Francisco in 2000, is known for the Psychonauts series. Ninja Theory built the Hellblade games, and Undead Labs is currently working on State of Decay 3.
Sharma also flagged trouble in France, where Arkane's management has begun required consultation with its Works Council over
